So far in our hundred day journey, you've done a lot of observations, probably talked to a lot of people formulated a lot of plan and ideas. But nothing really has happened yet. Maybe you're the luckiest son of a gun on the planet. And you've been brought on board to carry out a strong finance legacy, and which, as I say, carry on, but I have a hunch that you have a list of some sort. It may not be 101 items long, but there is something on the Strategic Action List. Anything else you should know before you pull the trigger, and incomes change management principles.

In this lesson, I'm going to touch on just three items. First, identifying which items in your action plan may require change management consideration. Second, to discuss the roles for you as a catalyst CFO to play during the transition. And then finally, to give you an overview of change management process and flag a few pitfalls for you to watch out for. Let's begin with situations You don't need change management consideration. For instance, changing a supplier or hiring a new employee do not need any special consideration.

The key distinguishing criterion for change management is simple and there's only one are groups of people impacted by the decision. In a nutshell, that's what it all boils down to, once again, the people, the more unique groups of people to implement the desired change, the bigger the change management challenge, you've got, groups employed more than one or two people, it could be a dozen people, it could be 10,000 people. So think of change management principles. If any of your action plans include integrating an acquisition, implementing a new e RP system, restructuring the finance function, changing the culture of the organization, or even within your own department, improving or streamlining business process. All of these sorts of initiatives involve require cooperation of groups. people moving along with Agenda Item Number two, the roles you will play during a change initiative.

Well, first of all, you will be a direction setter, you will have the vision of the future clearly in mind and will articulate the vision in words both written and spoken to direct the people in a coordinated way. As a change agent, you will anticipate the need for change, analyze the situation and build a case for change and then lead yourself and others through the treacherous transition phase that we'll get into in a moment. As a spokesperson, embarking on any sort of change initiative requires a tremendous amount of communication with employees on a constant basis. Your employee audience needs to see and feel the CFO living and breathing the new vision and hear this clear and consistent message. And finally, by your position, you will often default to the role of coach you will also need to coach yourself Through the transition head times empowering them to take on tasks that they may have little or no experience with.

So let's take a look at what this might look like in your mind. You're an executive, you see the big picture. So isn't it as simple as I have a current situation that's unacceptable, but I know where I want us to be. So if I could just get the people to make the connection between the two states, then we'll all be better off. Sadly, it's not that simple. The fly in the ointment is this transition state.

The transition state represents the organization in the process of moving between two states, senior managers, and the board directors tend to think of this transition as a zip line between the current situation and the future. The truth is, it's not linear at all. For those in the rank and file, the transition period raises anxiety. I like this quote about the transition state. It's not that We're so afraid of transition or in love with the old ways, but it's that place in between we fear. It's like being between trapezes it's lightest, what is blank and is in the dryer.

The primary challenges of change are first, misunderstanding that necessity for change. Second, getting people to let go of the old And third, measure the existing business and working on the transition at the same time. In fact, 70% of change initiatives fail according to Harvard's dr. john Kotter, keep the statistic in mind the next time you're contemplating a significant new initiative 70% failure. In fact, someone was said, no matter how hard you imagined it will be, you'll always underestimate the amount of work required to get things changed and have them stay changed. I'll walk you through a couple of models on change management, but realize there's a lot to be said on the top In fact, I have an entire course dedicated to this topic of which this is only a preview. First, you need to consider the human emotions that arise during change.

For this, a gentleman by the name of john Fisher created the transition curve. And having been through a few turnarounds in my career, I can attest to the accuracy of this work. The announcement of change triggers anxiety and possible excitement by the promise of a better future. But the reality sets in as people realize that jobs are at stake, and the workloads will most likely double in months to come. Business doesn't stop just because someone wants us to implement something new. Some people jettison the company feeling frustrated or angry or threatened, and those that remain may experience fear and depression, all of which pose risks to actually achieving any meaningful and lasting change.

But persistence, patience, and a carefully executed change plan can move people through the value of depression, moving forward and achieving acceptance. Dr. Carter wrote this process down into eight crucial steps for transformation. Step one is to increase the urgency. People need to understand why change is necessary. They need to understand what they are giving up in relation to what they will acquire. If the change initiative is not credible, it will fail the initial step.

In fact, Dr. Carter's research has shown that half of all change initiatives fail to achieve this lift off for this very reason. The second step of Dr. Karl's model is to create the guiding team or coalition, in other words, a group of people within the company with the power and influence to establish support for the change initiative. In the early glory of my turnaround attempts at the fish processing company, I did not have a supportive management team. This all changed when I myself and a couple of other managers were promoted to form a new executive committee committed to making changes necessary for a turnaround only at that point where my list of ideas in my head One things to do deemed credible by the managers across the organization. The next step of the model is to develop a vision and strategy. If you've been following along and the first five modules you should have this will enhance by this point.

The fourth step is to communicate the vision. The coalition force becomes the poster child for spreading its words and living by it. You can't underestimate the amount of communication required to effectively lead change. It can't just come from the top, it can't be communicated in memos. It needs those in leadership positions to live the vision and reinforce the communication. In the words of Cotter and cone.

The goal is to induce understanding, develop a gut level commitment, and liberate more energy from a critical mass of people. Now, the first four steps are intended to prepare the organization for change. But then comes Step five, which opens the floodgates by empowering your people to implement change. For myself and my fish processing company, we held an off site meeting with all of our senior managers. We all sat around in a big circle and had a frank discussion on the brutal facts of reality. We discussed the opportunity each and every one of us had to participate in the turnaround.

A few managers questioned our sincerity and their level of authority, we use the opportunity to empower them right there on the spot. And good things immediately started happening in the days and weeks and months that followed. Short term wins reinforce the rationale of change initiative. Without the wins, people lose faith in the long term vision. Ideally, these wins should happen within the first six to 18 months. The absence of wins fuels arguments from the critics, the cynics, the skeptics in my list of 101 items to fix it, my fish processing company, knocking out the first 20 items in a few weeks was relatively easy to do.

And within a few months, the financial results already started showing the progress of the turnaround. By the time you reach Step seven, declaration of a premature victory before changes have the opportunity to take for root can be catastrophic momentum needs to be sustained after those initial early wins. So in this step, as the slide says, I'm prone to saying don't stop until you get to the talk when you get to the top, don't stop. Keep in mind that I've adapted this model from Dr. Carter, but I assure you, he basically says the same thing. As soon as you scratch off most of the items from your to do list and initiate the next. Sustaining change requires recruiting the right individuals and weaving the desire change into the corporate culture.

It can take three to 10 years to make a change to corporate culture. Yeah, you heard me right years and years, the susceptibility to regression is a very real risk that needs to be addressed to make change stick. The challenge for most organizations is that we don't operate within a three to 10 year time horizon and this makes it more difficult To see through. Now, I found Dr. Carr's model after my experience with my fish processing company, but once again, I found it instructive that the challenges I faced along the way were predictable using this sort of a model. And as we broke through the barriers, we stumbled on these principles one by one, eventually leading to a successful outcome. To finish my story after working with the fish processing company for about a year and a half, the company turnaround was already well on its way, and nearly half of my list of to dues were completed.

In the year I left the company achieved record profitability. Our private equity fund was able to sell its position and triple its value in the year and a half I was involved. But that's not the end of the story. The company was acquired and rolled into another fish processing company. However, the US leadership team that I worked hand in hand with during those 18 months, was retained by the choir to run the US operations. In the seven years since my involvement The company has grown fourfold But in talking with old colleagues, it was the turnaround initiative that we instigated that got the ball rolling.

It really does take years and years to make change stick. In this course, we covered a lot of ground And much like your first hundred days, it was a frantic frolic through a wide variety of topics. We looked at the profile the modern CFO to answer the question about whether you yourself are prepared to take on this opportunity. we assessed the situation using a crew but probably effective enough maturity model. We looked at the principles behind a high performance team. We talked about ideas and how to construct your ideal finance team on paper using a competency mapping tool.

We developed a strategic management plan for finance, including discovering true values of your function, setting a mission statement and coming up with a Strategic Action Plan. We learned about structuring the finance function and various tables that you will need to consider. And finally we looked at change management principles before You wave of any magic ones, you will need to bear these principles in mind. So that's all for me. I designed courses to target the CFO competency map represent this course. And if you'd like any more information or a deeper dive into any of these topics, feel free to contact me.

Thank you and always bear in mind, don't stop using the top when you get to the top. Don't stop